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Local governments would see a cut of 25 percent per year and state colleges and universities would be limited to 3.5 percent tuition increases under Gov. John Kasich’s new two-year budget.

Meanwhile, 400 school districts are expected to see increases in state-generated funding, however it is unclear whether they will see an overall funding increase because of the loss of $875 million in federal stimulus money they got for operations that is built into the current two-year budget.

Local governments currently get more than $600 million per year of local government funding. Kasich and groups including the Ohio Chamber of Commerce have stressed that local governments will need to find new, more efficient ways to operate, including more collaboration and consolidation of services. Libraries also are expected to get cut 5 percent from current funding levels.

The budget, which Kasich will unveil to the media at 1 p.m., also includes a variety of Medicaid reductions, health care provider cuts, a lease of the state’s liquor sales operation and the selling of five prisons, which will be privately operated.